tag:blogger.com,1999:blog-6097510160054715524.post5525598652901235071..comments2024-01-03T21:42:28.979-08:00Comments on DivGro: Recent Sell: SNPFerdiShttp://www.blogger.com/profile/05008021146951839361noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-6097510160054715524.post-3356018814835433062014-09-28T20:00:16.089-07:002014-09-28T20:00:16.089-07:00Thanks for your comment, DivHut! I appreciate your...Thanks for your comment, DivHut! I appreciate your point of view. I agree that a dividend cut in itself should not constitute an automatic sell. There may be reasons behind a cut that needs to be understood. In the case of SNP and CHL, however, I found it really hard to convince myself of the future prospects of these companies and, in particular, their plans with regards to dividend growth. I read the latest financial reports (translated) of both companies. Information was terse, at best. Is this cut temporary? Do they foresee a recovery in the next few years? Can we look forward to earnings growth instead, with a hope of future dividend increases? In the case of GE, IR and WFC, as you pointed out, all started increasing their dividends again. Were you just hoping that they would? Or were you confident that they would recover quickly after the financial crisis and start paying/increasing dividends again? I presume you would not have invested more without some confidence in an eventual recovery. Finally, there are many great dividend growth stocks available, certainly more than I can afford to buy. Why hang onto the shares of a company that cuts their dividend, while many others continue to pay and increase their dividends?FerdiShttps://www.blogger.com/profile/05008021146951839361noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-11324355489328155902014-09-28T16:06:44.503-07:002014-09-28T16:06:44.503-07:00I know we are all dividend growth investors and do...I know we are all dividend growth investors and do not like when companies do not raise dividends let alone cut them. But you must always look at a total picture when deciding to sell a dividend stock. It's not a simple black/white decision that translates to automatic sells when a company cuts a dividend. If the overall business/industry is still sound and you believe in the future prospects you should consider keeping dividend cutters at times. Like I said, look at a whole picture not just one factor such as a dividend cut. Several years ago, several companies I owned cut their dividends but I still believed in all of them and held on and even added to my positions. I held on to my GE, IR and WFC after they all cut and today I'm happy I did. All started increasing dividends in recent years, have seen tremendous share price appreciation and one, (IR) even completed a spin off of ALLE that also pays me a dividend. While a cut is a red flag, it is definitely not a sole reason to sell a stock.DivHuthttp://divhut.comnoreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-29527748734413487072014-09-27T10:05:05.913-07:002014-09-27T10:05:05.913-07:00Agreed. By selling CHL and SNP I'm not suggest...Agreed. By selling CHL and SNP I'm not suggesting those stocks won't be good long term investments. But, I'm not interested in keeping them in DivGro, which has a dividend growth objective. I'd rather find replacement stocks that would ensure a growing stream of dividend income. FerdiShttps://www.blogger.com/profile/05008021146951839361noreply@blogger.comtag:blogger.com,1999:blog-6097510160054715524.post-82740122914264055982014-09-27T06:30:34.241-07:002014-09-27T06:30:34.241-07:00As with CHL, I think you've made the right mov...As with CHL, I think you've made the right move here. It all comes down to dividend growth, and if that growth isn't happening, especially if the dividend is getting cut, than strong consideration must be made whether it makes sense owning it going forward. <br /><br />Looking forward to seeing where you will put your cash over the next week or two.writing2realityhttp://www.writeyourownreality.comnoreply@blogger.com